GOP Lawmakers Move to End ‘Obama-Phone’ Program
Friday, 26 Apr 2013 01:03 PM
According to Bloomberg, 42 Republicans have co-sponsored the Stop Taxpayer Funded Cell Phones Act to end the Lifeline program, which was dubbed “Obama phone” during the 2012 election after a woman who was promoting the program referred to it that way.
The House Subcommittee on Communications and Technology held a hearing on Lifeline Thursday to investigate why the program, which actually began in 1985 under President Ronald Reagan, has tripled in cost since 2008.
Lifeline pays out $9.25 to companies every month for each customer on the program. In 2008, Bloomberg reported, it disbursed $772 million. Last year, the figure was $2.2 billion, according to the Universal Service Administrative Co., a Washington-based nonprofit that oversees the subsidies.
“It’s not fair that people save and work and pay for phones from whatever funds they have, and other people get them for free,” said Arkansas GOP Rep. Tim Griffin, author of the bill to end the program.
Nearly a quarter of last year's Lifeline payouts, $451.7 million, went to TracFone Wireless, Inc., the company owned by the world’s richest man — Mexican billionaire Carlos Slim. Although other phone companies, such as AT&T and Sprint, benefit from Lifeline subsidies as well, TracFone, which was added to the Lifeline program in 2005, usually receives the largest share.
The Federal Communications Commission has admitted that as the program has grown so has the waste and fraud associated with it, the Washington Times reports. The FCC tightened down on verifying eligibility requirements for the program last year and the number of participants has dropped.
Still, Florida GOP Rep. Vern Buchanan told the Sunshine State News: “It defies common sense that we are giving away millions of free cell phones at the same time the Federal Aviation Administration imposes cutbacks that are delaying fights across the nation.”
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